Neighborhoods Confer Health, but Not Wealth

Low-Income Families Who Move to Safer Areas Become Happier, Not Better Off

By

Ben Casselman

Updated Sept. 20, 2012 2:02 p.m. ET

Moving low-income families out of poor neighborhoods doesn't help the families escape poverty, according to a new study, but it does make them healthier and happier.

In a paper published this week in the journal Science, researchers from the University of Chicago, Harvard and other institutions, studied the effects of Moving to Opportunity, an experimental federal housing program in the 1990s that offered housing vouchers to more than 2,000 low-income families so they could move from impoverished areas into mixed-income neighborhoods. A separate control group had similar demographics but didn't move to mixed-income neighborhoods with the help of vouchers.

ENLARGE

Since relocating to the suburbs, Sabrina Oliver began studying to be a substance-abuse counselor at Anne Arundel Community College in Maryland.
Jonathan Hanson for The Wall Street Journal

The program aimed to boost education and income, by giving mothers and their children access to better housing and schools, as well as better job opportunities and social networks. By those measures, it largely failed. Participants moved to better housing and safer neighborhoods, but they showed minimal economic or educational gains.

But the program nonetheless had a pronounced effect on families' lives, researchers found. Participants had significantly lower rates of diabetes, extreme obesity, anxiety and stress than those who stayed behind. They were also much happier with their lives overall—something researchers said was particularly important.

"We don't see very important neighborhood effects on those two outcomes that people have focused on," said University of Chicago economist Jens Ludwig, the study's lead author. "But the things that people had been focused on and worried about with neighborhoods aren't the full story. Helping poor families is about a lot more than just increasing their income."

More on Housing

While moving to safer neighborhoods made a big difference in peoples' lives, however, moving to less racially segregated ones didn't. That is worrisome because even as the U.S. has become less racially segregated in recent decades, it has become economically segregated, with poor people increasingly concentrated in certain neighborhoods. From a quality-of-life standpoint, the researchers found, the increase in poverty concentration over the past 40 years has almost canceled out the gains in income among poorer Americans.

Sabrina Oliver's inner-city Baltimore neighborhood was so crime-ridden, she would come home to find drug dealers on her porch. Her daughter suffered from severe asthma and Ms. Oliver herself was too depressed to work. Most of all, she said, she worried about her teenage son.

"I didn't want him to become friends with the neighborhood kids," Ms. Oliver said. "You lose your kids that way, either to death or prison."

Then three years ago, Ms. Oliver and her family were able to move to the suburbs through the Baltimore Housing Mobility Program, a nearly decade-old effort to help poor families move to better neighborhoods. Now, her son is passing his classes, her daughter's asthma has all but disappeared, and Ms. Oliver herself is working part-time and going to college to become a substance-abuse counselor. The improved housing, air and schools all have made a big difference, Ms. Oliver said, but the impact of the move goes beyond that.

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"You see families function in a normal way, where the parents go off to work, the kids go off to school," she said. "I don't think that my children will be a recipient of social services because my life has changed drastically and they see the change in me."

Barbara Samuels, a housing attorney at the American Civil Liberties Union of Maryland, which helps oversee the Baltimore program, said Ms. Oliver's story isn't unusual. "There's kind of a sense of hopelessness, of being literally almost physically oppressed by your surroundings," she said.

Ms. Samuels—and other experts—say Moving to Opportunity notched limited economic benefits in part because the housing vouchers were too small for families to move to truly middle-class communities with better schools. For example, under the Baltimore Housing Mobility Program, Ms. Oliver was able to leave Baltimore altogether and move to Anne Arundel County, something she couldn't have done under the Moving to Opportunity initiative.

Harvard economist Lawrence Katz, one of the study's authors, agreed that most families in the study hadn't been able to move to better school districts, as initially hoped. And he said that other programs, such as ones that offer job training, have been able to boost people's earnings.

"Success at getting a better job really isn't about exactly where you live," Mr. Katz said.

In recent years, some economists have focused on happiness and other measures of subjective well-being that aren't fully captured by traditional gauges of wealth and income. For the Science study, participants were asked to rate their happiness on a commonly used three-point scale.

Comparing those findings with past studies, the researchers found that in terms of happiness, a 13-percentage-point drop in neighborhood poverty was the equivalent of a $13,000 increase in annual income—a dramatic increase for a population with average household income of just $20,000.

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